Black's Role In The U.S. Economy

Commentary by Dr. B.B. Robinson, Project 21

WASHINGTON - Some black women are not very concerned about the fact that 72 percent of black babies born in 2008 were born out of wedlock.

These women take an analytical approach to relationships and don’t always see a valid reason to marry the father of their children. They don’t see the logic in committing to a relationship with someone who may not be an equal partner, and who is probably not the leading economic provider in a family.

This somewhat perplexing assessment motivated me to think about the overall role that blacks play in the national economy. There’s no dispute that, as a race, we are not the leading economic partner. However, are we even an equal partner?

As an economist by trade, I decided to crunch the numbers to try to find out. I gathered 2008 and 2009 data of total output or gross domestic product (GDP) on a value-added-by-industry basis from the U.S. Department of Commerce’s Bureau of Economic Analysis. I adjusted and married these data to employment-by-industry-by-race data from the U.S. Department of Labor’s Bureau of Labor Statistics.

Performing a few computations enabled me to prepare rough market price measures of the proportions of the value-added-by-industry produced by black Americans versus the proportion that was produced by the rest of the nation. I also prepared these measures on a real basis, taking price change into account.

The measures that I prepared revealed that:

* On a current market price basis, blacks were responsible for about $1.3 trillion of the $14.4 trillion of 2008 GDP and were responsible for about $1.2 trillion of the $14.1 trillion of 2009 GDP.

* On a real basis (accounting for inflation), blacks were responsible for about $1.2 trillion of the $13.2 trillion of 2008 real GDP and were responsible for about $1.1 trillion of the $12.9 trillion of 2009 real GDP.

* The U.S. real GDP decline from 2008 to 2009 would have been 0.6 percentage point less had blacks not contributed to the economy.

* Inflation that occurred from 2008 to 2009 would have been reduced by 0.4 percentage point had blacks not participated in the economy.

Stated somewhat differently, blacks accounted for about 8.9 percent and 8.6 percent of U.S. GDP at market prices during 2008 and 2009, respectively. Notably, black workers comprised 11 percent and 10.8 percent of all workers, respectively, for the two years.

Keep in mind that Blacks accounted for 12.8 percent of the U.S. population in 2008. In other words, blacks accounted for a significantly smaller share of GDP than their representation in the workforce and in the population.

With a growing popular movement for — and a possibly budgetary necessity for — smaller government, this could bode ill for some segments of black America.

It’s no secret that there are a disproportionate number of black Americans in poverty and receiving government assistance in relation to the rest of the population. With some black women eschewing black men based on economic performance, there is unfortunately reason to worry that black America as a whole might be derided by some for not contributing our economic fair share.

Considering the ever-changing nature of the American economy, an increasing emphasis on technology and the fact that many of the jobs that blacks have performed, and continue to perform, are becoming obsolete due either to technology or to relocation overseas, blacks should deem it important to address this “productivity gap” issue.

Moreover, as areas in Asia and Africa rise as economic powers and resources become increasingly scarce, it is also possible that the nation may experience a reduced tolerance for providing assistance to those perceived as not carrying their own weight.

Depending on the extent of the scarcity, black Americans may face increasing economic pressure that could manifest itself in racial animosity.

While we observe past achievements during Black History Month, this pressing notion of productive inequality must be addressed. Based on past struggles, the question to ask is “How can we, as a race, can utilize education, acquired skills, ingenuity and our natural tenacity to become an equal economic partner?”